I would think that would be exactly your plan when you buy a non-performing note for a property you want. If you can work something out with the borrower (deed in lieu of foreclosure, or a writedown like you suggest), great. Assuming there aren’t other liens you could wipe out with a foreclosure. But foreclosure would be your most direct path to taking possession.
In your example, I would start with an offer of a deed in lieu.
Assuming the numbers work, is there any legal issue to offer a small chunk of cash, say $ 5000, or whatever, as an incentive to the delinquent borrower to take the deed in lieu and vacate the property?